New bill may place significant taxes on import of raw tobacco to Georgia for first time

The Georgian parliament is currently considering a bill which proposes to levy significant taxes on raw tobacco for the first time, Head of the Tobacco Control Alliance Giorgi Bakhturidze said earlier today. 

Bakhturidze mentioned that the consumption of hand-rolling tobacco has increased, particularly in the regions of Samegrelo, Samtskhe-Javakheti, Shida Kartli and Imereti regions, as well as in the capital city, Tbilisi.

The results of the study ‘The Impact of Taxes on Illegal Cigarette Trade' was carried out by the Institute for Social Studies and Analysis, in April 2019. The research  reveals that hand-rolling tobacco consumption has increased from 5 to 22-23 percent. The parliament is now considering a bill which will make tobacco taxable. The government was late, but the decision has finally been made", said Bakhturidze.

Giorgi Bakhturidze said that the prices of tobacco will be significantly increased, and will aim to reduce the number of hand-rolled tobacco consumers, which is harmful to health. 

Georgia also faces the threat of illicit trade, Bakhturidze noted. 

Georgian Finance Minister Ivane Matchavariani also spoke about new tobacco taxation at a briefing today.

The taxation of raw tobacco is very important. It turns out that a main excise good was not being taxed. Taxation will be moderate so that smokers will have access on the product”, Matchavariani said, noting that overall, smoking was down in Georgia. 

Excise taxes on cigarettes have been growing in Georgia since 2013 and in the last few years it has grown almost five times.

From January of 2018, new tobacco-control legislation was adopted and came into force: under the new law, a complete ban on smoking in all indoor public places was imposed.